European Market Strategist, Silver Buck
Since 2019, the German government has kick-started an unprecedented bouquet of digital activities to bring up to speed the country’s traditionally innovation-adverse healthcare system. It’s time to take a closer look: are we already walking in flourishing digital health landscapes?
During the past two years, Germany’s healthcare system has shown substantial progress to drive digitalization and the adoption and usage of digital health tools and services. This is especially true for electronic patient records and e-health apps. For the latter, the country has established a regulatory and reimbursement process, which allows health apps to be prescribed by doctors. The efforts around digital health did not stop here, but also included telemedicine applications and e-prescription. Finally, the government also took initiative and decided to invest 4.3 bill Euros over the next 2-3 years into modernizing the public hospitals’ clinical IT and digital care infrastructure and applications.
It is expected, that the digital health efforts in Germany will significantly boost market expansion over the coming years to achieve a compound annual growth rate of between 25-30% until 2025.
However, these initiatives haven’t faced their toughest test yet – and this is meeting the doctors’ and patients’ reality.
So, how did they stand this test? Well, recent data from a survey among well over 9000 participants from a digital health savvy stakeholder community suggest there is still some way to go. The online survey (officially called the epatient Survey) has been carried through by epatient Analytics.
In a nutshell, it found out that in spite of the digital efforts in German healthcare – and the additional effect from the Corona crisis – the usage of digital tools and services is stagnating or at its best only progressing at a very low level. A good example is the online medical consultation: only 2% of respondents declared that they have been using such a service (up from 0.7% in 2019). The increase is obviously there, but it remains quite insignificant. The same goes for tools and services such as medication management, patient coaching & support or diagnostics, for which usage numbers remain rather static.
What does it need to convince patients and doctors?
There are criteria for digital adoption that the regulatory and investment initiatives can’t address: things such as “digital health literacy”, access to digital services, content & tools, or the existence of integrated care structures & health information exchange.
Digital health literacy:
Digital health literacy enables individuals to acquire, create and share health related knowledge through information and communication via digital media. This also includes the ability to manage and evaluate such knowledge as well as use digital health tools and services. Digital health literacy thus represents a basis for successful participation in a healthcare system that is aiming at increasingly utilizing digital media, tools, services and processes. The larger the part of the “digitally illiterate” patient population is, the less likely it is that these people will adopt and use digital health tools.
A study carried out by one of the biggest public health insurers in Germany (AOK) in 2020, found out that half of the study participants did not dispose of sufficient overall media competence to take part in a more and more digitally driven healthcare system. Especially, chronically ill patients, poorly educated and lower income parts of the population seem to be disadvantaged.
Germany will have to reinforce efforts to improve digital health literacy. This can be achieved through alleviating access to digital health tools and services as well as through increasing individual skills (which is far from only being a healthcare challenge).
Access to digital tools:
There are major socioeconomic and demographic differences in Germany when it comes to the percentage of people having access to digital tools. The epatient survey, one of the most comprehensive studies of the digital health market in Germany carried out in early 2021, found out that 3 out of 4 users of digital services and tools are university graduates. Older people, people with a low social status and/or education level, and people with a migration background are less likely to have digital access than the general population. Typically, among people aged 65 and older, for example, nearly two-thirds still find it problematic or impossible to access digital tools, content or services.
Digital offerings still do not reach those who need them most.
This situation is particularly troublesome because older people are more likely to suffer from chronic conditions on the ones hand and often dispose of low resources in terms of self-management of their own health on the other.
Therefore, measures to promote and enable digital health access must also always be understood and carried out in a target group-specific manner.
Insufficient access to digital health and low digital health literacy is by no means only an individual problem, but rather a challenge for health equity and the health care system in total.
Integrated care & health information exchange:
Although more than eight out of ten physicians are already connected to the country’s telematics infrastructure, healthcare facilities still exchange medical data largely in an analogue way. Data from McKinsey’s eHealth Monitor 2020, show that 93% of physicians still communicate with hospitals in paper form, and not even half (44%) of all healthcare facilities (hospitals, outpatient physician practices) use tools such as electronic health records.
Integrated care structures and the exchange of health data are still insufficient in Germany. The country’s healthcare system to a large extent is still based on 3 distinct silos of care with too less exchange of (digital) data between them: ambulant, inpatient and emergency care. However, digital health only makes sense and is able to unfold its benefits in a connected healthcare system. If digital data stay within their silos of care, they are pretty meaningless and patients will see any advantages or find benefits. The gradual implementation of electronic patient records will improve on this situation. However, the creation and implementation of respective care structures must follow – including a more outcomes-based remuneration instead of the traditional fee-for-service model.
The development of the 3 criteria described above is traditionally weak in Germany. There has to be a continued effort to improve on them to speed up the broader adoption and implementation of digital health. Regulatory initiatives and initial funding alone will not save the day. Fortunately, this has been realized by many healthcare stakeholders and a number of initiatives are being launched to promote digital health literacy and get integrated care structures on the way.
What does it mean for digital health market stakeholders?
Even though the recent regulatory and investment endeavours, amplified by the Corona crisis, have contributed a lot to promote adoption and usage of digital tools and services among doctors and patients alike and also pushed the door to digital transformation wider open than before, the German healthcare system still functions in an analogue way in many areas: the transmission of health data by fax, mail and telephone is still part of everyday medical life, and the proportion of patients using digital services is still low for the most part.
However, the digital ground has been prepared in many ways and digital tools and services will eventually make their way into the healthcare system. As they always say: it’s like toothpaste – once it is out of the tube, you can’t get it back in.
It is a good time for digital health stakeholders to establish a footprint in the German market. If you want to learn more about how to successfully build your digital health market entry into Germany, contact Rainer Herzog.
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